Britain Rejects Call to Regulate Crypto as Gambling

LONDON, July 20 (Reuters) – Treating crypto assets as a form of gambling would put Britain at odds with global and European Union regulators and would not mitigate risks to the sector, Britain’s Financial Services Minister Andrew Griffith said on Thursday.

of parliament Treasury Select Committee It said in a report in May that bitcoin, ether and other “unbacked” cryptocurrencies should be regulated as gambling given the significant risks they pose to consumers.

Lawmakers worry that treating the sector as a financial service will lead consumers to think it is safer than it is, and UK regulators are warning investors they stand to lose all their money.

Britain wants to become a global hub for cryptocurrencies and its related blockchain technology, and is already working on rules for the sector.

The Finance Ministry “strongly disagrees” with the recommendation to regulate retail and investment activity in unbacked crypto assets as gambling rather than as a financial service, Griffith told the committee. in an answer to your report.

A gambling regulation system is not likely to address the risks highlighted by the collapse of FTX, a crypto exchange, Griffith said.

It would also go completely against globally agreed recommendations from global standard-setting bodies, including the International Organization of Securities Commissions (IOSCO) and the G20 Financial Stability Board (FSB) with input from national regulators, he added.

IOSCO proposed the world’s first set of rules for the crypto industry in May, with the FSB following Monday with more standards.

“Therefore, the approach proposed by the Committee would risk creating a misalignment with the international standards and approaches of other major jurisdictions, including the EU, and could create unclear and overlapping mandates between financial regulators and the Gambling Commission,” Griffith said.

The EU approved the world’s first comprehensive set of rules for trading crypto assets that will come into effect from mid-2024.

Reporting by Huw Jones; Edited by Andrew Cawthore and Sharon Singleton

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